A Lien Claimant’s Burden
The recent case of Torres v. AJC Sand Blasting and Zurich North America (2012) (2012 CAL.WRK.COMP.LEXIS.160) reaffirms the lien claimant’s burden at trial.
We have all had experience dealing with lien claimants who show up at conferences with a long list of billing, without any reports or evidence that they have sought authorization, or any explanation as to why their treatment was provided. To add insult to injury, they often demand interest, penalties, etc. on top of their billing.
Most of these lien claimants rely on the argument that their billing establishes evidence of treatment and, therefore, the burden then shifts to the defendants to prove that the treatment was unreasonable or provide some other defense to their lien. However, the court in Torres reminds us that Labor Code section 3202.5 and Labor Code section 5705, as well as case law, mandates that a lien claimant has the affirmative burden of proving all issues relevant to its lien.
The court in Torres noted that prior holdings such as those in Keifer and Garcia, which allowed the lien claimant to establish a prima facie case of entitlement to reimbursement by merely offering evidence that it furnished treatment have been abrogated by Labor Code section 3202.5 and Labor Code section 5705. The fact that the case has been settled by a Compromise and Release with the applicant does not relieve the lien claimant of their burden.
If injury has not been established or stipulated to, the lien claimant would then step in the shoes of the applicant and have to prove that the applicant’s alleged injury was industrially caused. If they do manage to establish that there was industrial causation, they would still be required to prove that the treatment rendered was reasonable and necessary to cure or relieve the effects of the injury. Simply submitting billing or a health claim form at trial does not establish industrial injury, it would not establish that treatment was reasonable or necessary, nor will it establish that the charges for treatment or services rendered were reasonable.
In Torres, the court noted that by proceeding to trial without any evidence capable of proving their claim, the lien claimant wasted the court’s time, the parties’ time and ultimately did agree with the judge that sanctions and attorney’s fees were appropriate. (The lien representative only offered an unsigned insurance form as an exhibit at trial.) Based on the Torres case, the defendants have an en banc decision on their side which, hopefully, will make lien claimants think twice about proceeding to trial and wasting the parties’ and the court’s time if they do not have any evidence. The Torres case clearly reminds everyone that simply submitting billing is inadequate to prove a lien claimant’s case. It is hoped that such case law, as well as changes under SB863, will force medical providers to comply with the law (i.e., seek authorization for treatment, produce medical reports that support treatment and provide only such treatment which is reasonable and necessary).
At this point, lien claimants should be on notice that simply showing up to a conference with billing could subject them to sanctions if they elect to proceed to trial without further evidence. Certainly as a defendant or someone who is defending against a lien, sanctions and attorney’s fees should be raised if a lien claimant elects to proceed to trial with their only evidence being a billing statement or health insurance claim form. Hopefully with the courts enforcing such case law as that enunciated in Torres as well as the Labor Code, we will see a decline in the amount of frivolous liens brought to trial.